News
Commonwealth Bank of Australia says it was pleasantly surprised by the reception it received for its jumbo three- and five-year print. The deal opened the Australian domestic credit market for 2023 with the largest volume ever seen in a local transaction.
The World Bank priced its latest Kangaroo Sustainable Development Bond inside its US dollar curve – a rare occurrence, the issuer says – thanks to attractive cross-currency swap dynamics. The issuer says offshore investors also appreciated the higher yield of Australian dollars compared with similar US dollar transactions.
Participants in the Australasian securitisation industry are realistic about the forthcoming impact of rate rises. But credit fundamentals that have so far surprised on the upside and a functional if challenging funding market give hope that the next phase will be manageable. Meanwhile, upheaval in the UK investor sector could pave the way for an enhanced global bid for Australian product in the medium term.
After a year of limited capital market issuance – domestically and offshore – there might be grounds for pessimism in the Australian corporate debt market. But a group of analysts, issuers and investors who gathered at a discussion hosted by Fitch Ratings and KangaNews in November 2022 say Australian credits are relatively well positioned as and when confidence returns to the market, despite the obvious challenges of the past year.
European Investment Bank executed the first green use-of-proceeds bond 15 years ago and since then this format, extended to include sustainability bonds, has come to represent close to half of its funding programme. Aldo Romani, head of sustainable finance, and Jorge Grasa, senior funding officer in the finance directorate of EIB in Luxembourg, discuss the year past and the future of the bank’s bond programmes.
Australia’s big-four banks returned to wholesale public issuance in size over the second half of 2021 and into the turbulent market conditions of 2022 – though their actual balance sheet need changed less than some might think, even through the preceding pandemic. At the annual KangaNews-RBC Capital Markets big-four bank funders roundtable, the majors discussed how their issuance strategy is responding to the latest wave of challenges and new market conditions.
Australia’s requirement for robust sustainable finance measures is now supported by the federal government’s commitment to cut emissions and the global target renewed at COP27. The rules covering deployment of capital, however, are still being written.
Australian Unity is a unique business in Australia, as a mutual entity with operations in investment management, banking and healthcare. With its community and social values framework as a touchstone, Matthew Moore, head of responsible investment and stewardship at Australian Unity in Sydney, says the company deploys consistent responsible investment principles across its investment decisions.
The Westpac-KangaNews New Zealand Sustainable Finance Summit focused on the need to turn decarbonisation plans into action across the local economy, supported by an energised and evolving domestic capital market. At the end of another busy year, Westpac’s Auckland-based head of sustainable finance, Joanna Silver, discusses progress made so far and goals for 2023.
In November 2022, KangaNews and Westpac hosted the New Zealand Sustainable Finance Summit as an in-person event in Auckland, for the first time since 2020. Speakers discussed the pressing need to turn good intentions and high-level thought into action on climate transition.